Featuring the Three Tenors in La Triviata
In the Three Tenors case the FTC found an agreement to be an antitrust violation despite the fact that there was no way it could be anticompetitive. The Commission failed to heed the lessons of Coases classic paper on the nature of the firm, making a sharp distinction between activities within a firm (legal) and across firm boundaries (not legal). Analytically, there should be no distinction. The decision to integrate activities by contract rather than ownership is a matter of relative transactions costs. Since the boundaries of the firm are, ultimately, an economic decision reflecting the costs and benefits of the alternative arrangements, there is no economic justification for making the legality of any act contingent upon whether it was on the proper side of that boundary. Nor is there any particular virtue in using antitrust rules to alter the relative costs so as to shift that boundary to favor bringing activities within the firm. The paper proposes a quick look approach. The first thing to look for is some indication of market power. If antitrust harm is not credible, as in this case, because there was no market power, stop looking.
Year of publication: |
2005
|
---|---|
Authors: | Goldberg, Victor P. |
Published in: |
Review of Law & Economics. - De Gruyter, ISSN 1555-5879, ZDB-ID 2191851-X. - Vol. 1.2005, 1, p. 55-64
|
Publisher: |
De Gruyter |
Saved in:
Online Resource
Saved in favorites
Similar items by person
-
Lawyers asleep at the wheel? : the GM-Fisher Body contract
Goldberg, Victor Paul, (2008)
-
The enforceability of the GM-Fisher Body contract : comment on Goldberg
Klein, Benjamin, (2008)
-
Featuring the "Three Tenors" in La Triviata
Goldberg, Victor Paul, (2005)
- More ...